disability insurance ripoff

[Arial]

i recently became disabled because of chronic back pain and went out on short term disability which was a 1yr period. it then turned into longterm disb., for which i have not returned to work to date. i was employed by a large insurance firm and rec. income on a monthly basis. i was made to apply for social security thru this comp. and was awarded social security disability pymts. in 4/2002. ssd only pays a portion of my mnthly income and the ins. co. pays the balance. now this ins. com. has ceased all pymts. because they stated the monies i rec. in 4/2002 should be repaid back to them bec. i owe them the sum of $20,000 for income rec. in the last 4yrs. i refused to repay bec. this benefit was paid thru premiums from salary for 18 yrs of employmnt. it was told to me that this refund policy is a part of our health plan documents, but you are not told this at enrollment time nor rec. a copy of this doc. since i refuse to repay, the ins. comp. has ceased any more mthly pymts. to me and will not release any until 2009, when all monies are paid back. the big ins. health provider is aetna. i never signed or agreed to repymts. i now rec. no more pymts from them, only ssd. can they do this? what are my rights? i owe them more than i rec. from ssd. help!!!!

 

[CIAA]

Arial,

Most, if not all, employer sponsored group disability plans have a provision that states they the monthly insurance benefit will be reduced by the monthly amount you receive from SSD. If they pay you the full insurance benefit while your SSD award is pending (and most do), they are entitled to recoup any overpayment once you are approved for SSD. Mathmatically, this should not exceed the lump sum retro- active benefit that you initially receive from SSD once you are approved. Therefore, it is confusing when you state that they are asking for a return of all benefits paid in the last four years.

Is this legal? Yes, but only for the amount and to the extent specifically stated in your plan document (policy). You are certainly entitled to a copy of your plan documents and these should be requested in writing from the plan administrator.

Consumer Insurance Advocates Association, Inc.
1-800-709-CIAA

 

[Arial]

Disability Insurance Ripoff

CIAA Member,

My mthly income from the ins. comp. was in fact reduced by the amt. of ssd rec starting on 6/2002. they only want to collect the amt. rec from 1/2001 to 4/2002, which is the time period that ssd awarded me. this amt came to $17,000. the amt the ins. comp requests in repymt is $20,000. they stated there was a few overpymnts made which in checking all my records of pymts rec. does not add up to this amt. they sent me a copy of their calculations, it adds up to the $20.000. i understand what you are saying, but in this case if i never agreed to repay, how is it that they can just suspend pymnts with no signed agreement? i have also requested a copy of plan documents. i did not want to apply for ss, they forced me too, and now they want the proceeds of this money. what are the premiums i paid on a weekly basis for? and believe me the health ins. it is not cheap. how can i fight this, and where do i start? any and all suggestions are appreciated. with this procedure, i stand to loose everything including my home because w/o the full income, i cannot make it. i have already filed bankruptcy, and now can't keep up with those pymnts because of change of income. also within 18 mths i fall under the COBRA rules for health ins according to AETNA. there must be someway or someone who is in a similar situation who feels "defeated in one blow" by the ins. companies system. i feel what they are saying to me is, yes you worked and paid your dues, yes you got sick, yes you got paid, now, yes payback or die!!!

 

[CIAA]

Arial.

As I previously stated, the agreement allowing them to offset your SSD benefits is in the policy (plan document). Typically, these policies state that if you don't file for SSD they can reduce your benefit anyway, so it is a good thing that you applied and were approved.

Since you have been approved for SSD you are eligible to have your COBRA extended for an additional 11 months and by that time you shoud have qualified for Medicare. Once a person is on SSD for 2 years they qualify for Medicare just as if they were age 65.

The reason for the "offset" is because if you receive full benefits from both your income would be more than you were making and reduces any motivation to return to work, if possible. Therefore the state allows this kind of policy provision.

The amount of premiums you were paying were reduced and based on the reduced benefit amount that the insurance company would have to pay once you were approved for SSD.

You certainly don't have to repay an amount that is not correct and you should have someone knowledgable to help you make sure the calculations and offset is correct and in accordance with the policy provisions.

I'm afraid you will have to rely only on the SSD benefit for sometime. Perhaps you can get help from state or local agencies or organizations to help you through this difficult time.